Yesterday, Governor Pat McCrory signed House Bill 4, the first step towards paying off North Carolina’s $2.5 billion debt to the federal government and reforming North Carolina’s unemployment insurance system.

“I will not outsource these tough decisions,” said Governor McCrory. “This bipartisan solution will protect our small businesses from continued over-taxation, ensure our citizens’ unemployment safety net is secure and financially sound for future generations, and help provide an economic climate that allows job creators to start hiring again.”

Sponsored by Representative Julia Howard, House Bill 4 received bipartisan support in the General Assembly to pay down the $2.5 billion debt North Carolina owes the federal government.

“Faced with North Carolina’s growing $2.5 billion debt, it was necessary and imperative that we pass this powerful and common-sense reform. This bill, which brings our State’s benefits in line with our neighbors and does not burden small business to pay a debt they never accrued, is an important step in reconnecting our unemployed workers with jobs and restoring fiscal integrity to our U.I. system. We commend the Governor for his leadership to make North Carolina’s business environment more competitive in attracting and retaining jobs,” said Rep. Howard.

Statement By State AFL-CIO Secretary-Treasurer MaryBe McMillan on Gov. McCrory Signing Unemployment Cuts Into Law

“Only bullies kick people while they are down.”

Last night in his State of the State speech, Gov. McCrory acknowledged that “too many are hurting” in North Carolina. Yet today Gov. McCrory added to the hurt by signing into law the most drastic cuts to unemployment benefits that any state has ever enacted. The permanent cuts in benefits in this law are bad enough, but to turn down $780 million in federal funds and cause 170,000 families to lose extended benefits is just plain cruel.

With the stroke of his pen, Gov. McCrory severed the lifeline for thousands of unemployed North Carolinians, and he made clear that his allegiance lies with his corporate donors rather than his constituents. As one of the first laws under his tenure, these cruel cuts will forever mar any legacy that Gov. McCrory hopes to leave behind. Only bullies kick people while they are down. Shame on our Governor and our legislature for turning their backs on unemployed workers.

This is a sad day for North Carolina. Advocates for working families in North Carolina are uniformly disappointed with today’s signing of the unemployment bill. Hundreds of thousands of jobless workers thrown out of work through no fault of their own will face deepening poverty as a result of this decision.

Everyone in North Carolina should be disappointed in both the substance of this bill and the manner in which it was passed.

A radical, out of the mainstream restructuring of a crucial support system was rushed through in two weeks. No input from workers’ groups was allowed during the process. The people most directly affected were given no voice.

What the bill does is even worse than the way it was passed. No state has ever cut unemployment benefits this sharply, this quickly. No state has ever turned down hundreds of millions in federal benefits the way this bill does. North Carolina’s legislature and Governor chose to permanently cut benefits, reduce employers’ contributions over time, and reject $700 million in federal extended benefits.

Beginning July 1, this will hurt 170,000 long-term unemployed people and their families — all during a time of high unemployment and three unemployed workers for every available job. Over the long term, it will hurt hundreds of thousands more. Morally and economically, it is a shameful and shortsighted decision.